Setting Up Xero for NDIS Support Workers & Providers: FY 2027

Xero is Australia's leading cloud accounting platform, and when configured correctly, it is an extremely powerful tool for NDIS support workers and service providers. A standard setup, however, does not capture the specific billing details or tracking categories needed for NDIS compliance. This guide walks you through setting up Xero for the 2026–27 financial year (FY 2027) so your books stay audit-proof and tax-ready.

Step 1: Customize Your NDIS Invoices

NDIS plan managers will reject standard invoices that lack necessary details. In Xero, go to Settings > Invoice Settings and create a custom NDIS branding theme. Your invoice template must contain the following placeholders or fields:

• Participant Information: The client's full legal name and NDIS participant number.
• Support Item Codes: Each line item must explicitly show the NDIS support code (e.g., 01_011_0107_1_1 for Assist Personal Activities - Standard - Weekday).
• Detailed Service Description: Include the date of service, start time, end time, and total hours delivered (e.g., "05/07/2026 support shift: 09:00 - 11:00, 2.0 hours").
• ABN & Payment terms: Clear payment terms (usually 7 or 14 days) and your bank account details.

Step 2: Configure tracking categories for reporting

NDIS providers often deliver services across different categories (such as Core, Capacity Building, and Capital supports) or through different offices. Xero's Tracking Categories feature allows you to tag income and expenses without creating a complex chart of accounts. Setting up tracking categories enables you to run dynamic Profit & Loss reports to see which divisions or support types are driving profit and which are operating at a loss.

Step 3: Update Payroll for the 12% Super Guarantee

If you run a team or pay yourself through a Pty Ltd structure, you must update Xero Payroll. From July 1, 2026, the Super Guarantee rate increases to 12.0%. To configure this:

1. Navigate to Payroll > Employees and check each employee's pay template.
2. Ensure the "Superannuation Calculation Type" is set to "Statutory Rate". Xero will automatically adjust the calculation to 12.0% on July 1.
3. If you have set a fixed dollar amount or percentage, update these templates manually to remain compliant with Fair Work requirements.

Step 4: Establish a GST-Free Revenue Code

Most NDIS services are GST-free under section 38-38 of the GST Act. In Xero, go to Accounting > Chart of Accounts. Locate your primary Revenue account and ensure the tax rate is set to GST Free Income rather than Tax Exempt or GST on Income. This guarantees your quarterly BAS report calculated in Xero matches the ATO rules perfectly.